Wednesday, June 1, 2011

Debt Wars: DC's Summer Stock Greek Tragedy

The key to understanding the debt battle between the GOP-led Congress and the Obama White House is honing one's ability to separate the theatrics from the serious efforts to reach a deal before an Aug. 2 deadline.

Last night's House vote was stage play. House Speaker John Boehner called the vote to make a point that Congress would not raise the debt limit from $14.3 trillion to $16.7 trillion unless the bill includes widespread budget cuts. The House voted 318 to 97 against the measure.

MSNBC's morning anchor Chuck Todd reports that Boehner and the Republicans whispered to their Wall Street pals that the House voter was "a sideshow" -- a stunt to make a point.

Another kabuke dance was expected at this morning's White House meeting in the East Room. Obama planned to cite a letter the late President Ronald Reagan wrote to congressional leaders on Nov. 16, 1983. Previewing the letter, White House spokesman Jay Carney read from its text:

"The risks, the costs, the disruptions and the incalculable damage lead me to but one conclusion: The Senate must pass this legislation before the Congress adjourns."

There are no signs yet of a serious effort at compromise.

The GOP is opposed to increasing the government's revenues by either eliminating some tax breaks for corporations or raising taxes on the waelthiest 2% of Americans. They want belt-tightening to pull the country out of the listing economy and some type of fiscal alchemy that will prevent future borrowing.

The Democrats are fearful the GOP sweeping austerity measures will tank an economy that ius again shop wing signs of trouble. The White House argues that the House GOP will forego raising federal taxes, putting pressure on local communities tro raised property taxes to pay for basic services -- and raising property taxes at a trim when the housing market is slumping is not going to spur home sales.

It will be interesting to see how long Americans will put up with the thespians in the federal government this summer. There is much pain felt the past three years at the kitchen tables of America. This may not be the right climate for political one-upsmanship.

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